Jeffrey Sonnenfeld: The CEO Whisperer

Harlan Krumholz: Welcome to Health & Veritas. I’m Harlan Krumholz.

Howard Forman: And I’m Howie Forman. We’re physicians and professors at Yale University. We’re trying to get closer to the truth about health and healthcare. This week, we’ll be speaking with Dean Jeffrey Sonnenfeld. But first I wanted to ask you about yet another paper that you published this week, Harlan, and this time on how we should be thinking about tackling untreated and poorly treated hypertension, which remains one of the most insidious factors in generating future morbidity and premature death. It’s an unusual study. Can you tell us about what you did and what you found?

Harlan Krumholz: Sure. And maybe I’ll just broaden it a second. This is a paper that was led by Yuan Lu, who’s one of our excellent faculty members here at Yale, and a team of people, including some trainees who came together to try to provide insights as to why people are unable to get their blood pressure under control. What’s the cause of persistent hypertension? We’d written before about this entity of persistent hypertension. People who repetitively, through many visits at the hospital or clinic, continue to have high blood pressure that seems very hard to bring down. This is part of a larger-scale investigation in which we’ve made a very interesting discovery, Howie. We’ve discovered that the medical record data actually is a treasure trove of information that can enable us to identify individuals who are being overlooked.

We actually call this project kind of falling through the cracks. People hidden in plain sight. They have actionable data about themselves, but the healthcare system’s not really recognizing that there’s something here that needs a reaction, needs intervention, needs something to be moving on. And sometimes we’re finding people with diagnoses that have yet to be recognized, sometimes we’re finding treatments that that need to be adjusted, but in this case, we’re looking at people who have repetitive high blood pressure readings, but seemingly the system’s not embracing the idea that we really need to jump in, that there’s bad things that are going to happen unless we do something.

And this paper was about digging into the medical records and really being able to illuminate that there’s many different causes of this, and trying to put people in different categories, classify them. It was a taxonomy that ultimately can say, “This person needs a pharmacist. This person needs a social worker. This person needs a nurse. This person may need a physician.” Be able to triage people appropriately so that they can get the help they need and they can achieve the goals that they might set for themselves with regard to being able to control this risk factor. So if we’re really going to get to hypertension, one way we think is to take advantage of all the data that’s just sitting there, being able to systematically, with the advanced technology that we have today, go through, sift through it, identify it, and then work in partnership with people to try to bring a precise approach to them to bring what they need. So anyway, yeah, we came out, we’re excited about.

Howard Forman: I’d encourage our listeners to just read the paper, just to read the narratives around why people are not appropriately treated. It’s really challenging. It’s not as simple as cookbook. It’s getting people who sometimes have cancer at the same time they have hypertension and figuring out how to manage both effectively. So I think you did a great job with that, and I learned a lot from reading that paper and I’m happy we’ll link it into the website for the podcast.

Harlan Krumholz: Great, Howie. Let’s turn to Jeff Sonnenfeld. This will be a great interview.

Howard Forman: Jeffrey Sonnenfeld is the senior associate dean for Leadership Studies and Lester Crown Professor in the Practice of Management at Yale School of Management. Prior to joining Yale, he served as a professor at Emory’s Goizueta Business School for nine years and a professor at the Harvard Business School for ten. He is the founder and president of the Chief Executive Leadership Institute, which advances leadership education through research and forums for CEOs. Professor Sonnenfeld’s articles have appeared in numerous leading journals, and he has authored multiple books, including The Hero’s Farewell and Firing Back.

In 2018, he was awarded the Ellis Island Award, Business Week named him among the 10 business school professors who are influencing contemporary business thinking, and Directorship magazine named him among the hundred most influential players in corporate governance. Professor Sonnenfeld earned his undergraduate, masters of business administration, and doctoral degree at Harvard University. And from personal experiences, students love him, and he is the CEO whisperer, influencing commerce near and far, and the media turns to him with deserved reverence whenever there is an unusual leadership change or special situation at a Fortune 500 company. So Jeff, when you left the Philadelphia suburbs and went off to Boston, did you expect to be the man who would one day convene leaders and help them better understand the world around them, learning from each other and from you?

Jeffrey Sonnenfeld: No. All I knew is that first I didn’t want to become a men’s clothing retailer, like my poor dad wound up, trapped into that field coming out of the Second World War. But I did think that I would be dressed in white like you guys, actually was a closet pre-med at Harvard as an undergraduate and working as a volunteer at Mass General Hospital. I realized that I didn’t have the passion that you guys have and the patience to work as you did. I loved, of course, the interaction with people in distress and being able to help. However, I loved the dynamics of the larger hospital and the way the systems worked, and Mass General was a very happy place. My parents had been very ill when I was young. Many times I had them both in the hospital at the same time. And was being colorblind, I was running that family clothing business while still in high school periodically.

And the Philadelphia hospital system at that time was not a pleasant system to be in. Massachusetts, especially Mass General, was so different with the entrepreneurial sense of different units, the sense of pride in the enterprise. I thought, “This is remarkable. This is how healthcare could be.” But I realized this is how organizations could be. So I wound up morphing, to my parents’ shock and distress, into taking a look at management and organizations instead of taking a look at becoming a pre-med. So that’s how I got into this. And I actually, in the middle of organic chemistry I took a course called Human Behavior and Organizations thinking, “I can’t believe people get course credit for this kind of stuff and that you could actually have make a living here, let alone have impact in society.” So it was that late in my undergraduate studies that I transitioned over to get my MBA and doctorate, became the path.

Harlan Krumholz: Jeff, it’s such a pleasure to have you here. Your influence is so broad-based, and your commitment to making the world better is so clear. I wanted to ask you a little bit about leadership. So one of the things historically that’s occurred in medicine is we’ve really wanted player-managers. I mean, in order to have credibility on the front line, there was an effort to try to say, “You need to be doing X percent of your time actually seeing patients” or being able to demonstrate that you know what it’s like to be in that frontline area.

But as our systems, our organizations, as healthcare itself has gotten increasingly complex, I’ve begun to believe that maybe to have had formative experience there would be useful, but actually it’s an entire skill set in and of itself to run the organizations. And yet sometimes when that happens, it’s hard to gain the hearts and minds of the people on the front lines because they’re used to thinking that that person needs to be engaged in the actual work of the organization as well as running the organization at the same time. I mean, you’ve seen this in different spheres, and of course in business. It’s nice for the CEO to sometimes run a cash register, see what it’s like, but we don’t expect that person to be spending every week actually building widgets in addition to running the company. Do you think that there are differences in healthcare that we actually should expect our leaders to be also providing care? Or is that an old-time view of things?

Jeffrey Sonnenfeld: In some ways it’s almost a Maoist view of things, but in a good way, about tilling the fields before we move in to senior leadership. And it used to be at McDonald’s you had to work your way up by working, flipping burgers and fries and things, and at UPS, all the senior leadership used to have to be at some point in their lives an hourly worker, largely a driver. And companies have lost that connectedness with the front lines. And I think in healthcare too, it comes at a risk. It doesn’t mean that to be a great oncologist you have to have been a cancer patient yourself. There’s a lot that of course you can learn by analogy and learn by the accumulated experience of others. So using that as sort of the analogy, you can be a great manager of physicians and nurses and other healthcare professionals even if you haven’t had first-line patient and service delivery experience as a career, but you need to have a sensitivity to it.

Just like if we were to jump to look at the pharmaceutical companies, I think it’s fantastic that we take a look at some big pharma companies like, I don’t know, Pfizer and Moderna and Regeneron have scientists at the helm. I think that gives them a certain advantage. But some other places like Johnson & Johnson, and recently at Merck. Merck of course did have a legendary great scientist for quite some time who was... yeah, exactly considered perhaps one of the greatest CEOs of the country ever, is that there’s a way that a nonscientist can still lead a pharma company very well, but they need to compensate for what they don’t have. And that means by having teams that are very close to the top, advisors, and that they spend time outside of their offices, outside of boardrooms, outside of Wall Street, and be in the hospitals and be in laboratories and things like that. So there are ways to overcome it, but I think you’re right, being about the player-coach, the player-manager, it has great advantages.

The downside is a lot of times, and we saw this in the consulting firms, consulting world, where you had great player-coaches who were the CEOs of consulting firms never want to admit that they had leadership issues within their organization. They always thought it’s the client that has the problem because they still had the professional’s mindset. They didn’t understand the complexity of their own system. So there needs to be a balance. Somebody who’s a player-coach has some advantages but has some disadvantages. They have to figure out how do they leverage themselves and not think the way they did back only as a professional. When anybody gets a promotion, one of the greatest sources of derailment, the research shows, is that they think they’re doing a grander version of the last job. They have different tools of measurement of success in the new elevated position, different relationships, different integration of disciplinary fields. So you can’t just be the player-coach. So there’s an advantage and a disadvantage, there’s long and short in healthcare.

Howard Forman: Coming from the other angle of things, one of the things our listeners cannot be aware of unless they’ve worked with you is just how amazing you are at facilitating conversations with people who quite frankly have the biggest egos in the world. I mean, the people that you’re leading in conversations are often some of the most successful leaders of Fortune 500 companies, and you get them to have an open, honest conversation about whatever topic is the theme of the day. Is this something that you are able to anticipate, or does it happen organically, that you’re able to get them to talk about difficult topics amongst each other and have the confidence and the awareness of what they’re doing in that environment?

Jeffrey Sonnenfeld: Thanks for the question. A lot of the models for adult learning are still too much drawn on how the golden decade of age 18 to 28 learn. Educators are trying to say, “How do adults learn?” Adults learn, but it’s a lot more pragmatic. Our CEOs are action-oriented people. They also are smart. Many of them are as smart, some of them smarter, than our academic colleagues, but they learn differently, not just in that it be more pragmatic, is that they move on to different topics. We recently took a large group of top executives through the Metropolitan Museum of Art, and Dan Weiss, the CEO [of the museum], figured this out very quickly. He gave us a tour guide to go through the place where I thought she must have been on speed and wearing rollerblades. And the execs loved it, because we got through 80% of the museum in 90 minutes. Any art historian would’ve been horrified, but for what they wanted to learn, that’s the way they learn.

They go through things very, very quickly, and we move from topic to topic. We’ll take on an issue whether or not it’s healthcare and looking at pandemic issues or taking a look at supply chain issues or looking at social impact, voting rights and racial justice and gender parity, whatever it is, we move to different topics. So if you stay with the same thing for more than 90 minutes, they start to get frustrated because that’s just not the way they think. So also, we don’t have, ever, a passive audience. It used to be in the beginning, we’ve been doing this about 35 years. In the beginning, their offices all wanted to know who else was there and what is she or he going to have to speak to do a hit-and-run delivery. There are no speeches. We create a three-foot, two-foot, one-foot [tiered] amphitheater, the way the Greeks would recognize, it’s a 180-degree semicircle, they can see each other and there’s no raised dais, no stage, no dreary PowerPoint presentations where somebody drones on or reading off a teleprompter.

If I even see handwritten scripts, I’ll walk over... or the back of an envelope and tear them up because I’m not beholden to any of the... You don’t have to talk, but if you do, it has to be a dialogue and candid about their surfacing, their setbacks, and also I think trumpeting their triumphs. So we want to get to the reality of what they’re wrestling with, and people can learn. We’ve had just recently at one of our sessions in dealing with Eastern Europe, we had some pharma companies who were concerned about intellectual property issues. The IT people couldn’t believe that they had the exact same issues where they’re used to going off to forum seminars, industry events where one of them will get up on a stage and give a speech of clichés, and they wouldn’t realize that other industries have a different way of approaching the same thing.

And they could learn from something about dealing with industries in transition and regulation that’s vague, or competitors that... suppliers which become competitors overnight and how you deal with that. So they can learn from parallels that way, and that’s the way we set these things up. It’s just really taken on a life of its own. But by the way, we started before the World Economic Forum of Davos, Forbes, Fortune, Business Week, The New York Times, Wall Street Journal or Bill Gates at Microsoft or anybody had any of these CEO gabfests going, and unwisely, perhaps I helped them each launch. I figured they’re going to do it with or without me, and I could divert them away from what we do, which the focus on their real jobs because they could go to somebody better than me and then we’d really be in trouble. So we just drove them away from what we focus on and got them setting up looking at global political matters while we focus on how do they cultivate their own gardens and their own businesses.

Harlan Krumholz: Yeah, these are real master class when you run them. I mean, you’re able to keep things moving. And I wish all of our classes could be taught like that. In fact, you could give a lesson to others about how to keep people engaged. Let me ask you a couple other quick hitters here. So leaders: born or developed?

Jeffrey Sonnenfeld: The make by trade-off is a hard one. There are people... it’s sort of like as we talked about the player-coach, if whatever you don’t have, you can compensate for it. Just like we said, if you’re not a scientist, not a physician, you’re managing a scientific or healthcare organization, how do you compensate for what you don’t have, and how do you not over-deify yourself because of what you do have? Is there some people who are naturally gifted charismatics. A lot of times what we consider charismatic, though, are people that are backslapping, vivid cheerleader sorts, and some of those people do a great job of engaging attention, but you don’t necessarily trust them. Another element, then, of charisma where somebody else could be far stronger is that they show tremendous empathy. Is there a caring dimension? That can often be compensatory for the backslapping personal dynamism that people think is charisma.

A third dimension also has to do with, are you able to stretch people, not stretch them to the point where they snap, but you’re not happy with the status quo, that you have elevated standards. And a fourth dimension has to do with the modeling what you preach. It’s a genuine authenticity. It’s your moral dimension, your moral anchor. Do people really believe you? Do you operate in the same way that you say you do? When Johnson & Johnson had their famous Tylenol crisis, a lot of business schools, in fact, almost every business school in the country teaches about the value of the credo on the wall.

The truth is, I knew Jim Burke, the CEO at the time, everybody in the company interpreted that credo a different way. Some people said, “Make the Tylenol poisoning, compartmentalize it as a McNeil Labs problem and don’t let the brand disease spread to Johnson & Johnson.” He said no, and he modeled what the credo really stood for instead of how it was being over-lawyered by people saying, “We need to take responsibility for this, be transparent, go out there and centralize what we’re saying, making sure we’re giving a consistent message.” It was a model of crisis management, but it’s how you practice that. And the last one has to do with resilience from adversity is that we all have setbacks, we all have our Job stories. As Nietzsche said, “What doesn’t kill me makes me stronger.”

Harlan Krumholz: Can you be an introvert and be a leader of a massive organization?

Jeffrey Sonnenfeld: It’s possible, but you have to figure out a way where if you’re not great at rousing speeches, is you still need to be out there. If it’s on one-on-ones, [then] get out there, be accessible. But there’s personal dynamism, for example, can be compensated for by using vivid imagery when you speak and write and being available to others on one-on-ones. Introverts can be pretty good, but by the way, it’s a hindrance. I can go on and on how you compensate for it, but on the introversion/extroversion scale, an introvert has a harder time having the comfort level to project and lead others.

People will often misread your shyness as being a lack of concern and diffidence and things, and that’s unfortunate. There are some drawbacks to the extrovert when it leads to too much grandiosity and self-focus, which can be a problem. But an easier problem to correct is to deal with often the flamboyant extrovert, unless it was our former president, as you can sometimes harness some of that grandiosity if they’re willing to learn, but you need to have that critical feedback, and people, as we said, atrophy in high office, you don’t get that feedback, but somebody who’s a pure introvert is a huge hardship for leading a large institution.

Harlan Krumholz: Let me ask you one other, and then I’ll pass it over to Howie, because I think there’re a few other quite interesting things that you could share with us. But I also had this question. You’ve seen so many CEOs over the years and really gotten to know them and their paths upward. I’m wondering, to what extent do you believe that the people who become CEOs in these positions, leaders, it’s serendipity versus planning?

Jeffrey Sonnenfeld: There was an article that was in Fortune magazine about 30, 35 years ago called “Luck and Careers,” which was ironically in a magazine called Fortune, and in there it was all talking about, what CEOs at that time were talking about, the serendipitous accidental opportunities they had. Unless you knew those people or drilled down deeper in the stories than the Fortune magazine article went, you realized it wasn’t really pure serendipity. There aren’t expected opportunities and setbacks that come along, but as Louis Pasteur advised that, “Chance favors the mind that’s prepared,” these people had set up opportunities. If they knew who was going to be riding at 30 Rock in the elevator, which elevator bank they would take at Rockefeller Center, when they took on that job to be an NBC page or whatever it was, they tried to manage the opportunity so they would be there if certain things would happen.

It’s just like there’s uncertainty in the financial market. There’s uncertainty in a product market. There’s uncertainty in a labor market with careers. It’s sort of a bounded serendipity, maybe. You try to manage the odds favorable your way, and that’s true of career advancement too. It’s not sheer luck. There’s more than luck. A lot of it has to do with preparation and managing the context and also the reputation that you build, that people trust you and you can prove your competence in the sequence of assignments that you take. There’s some people who are perpetual malcontents. I’ve studied people for 45 years that were graduates from the Harvard Business School. One of the sort of tragic things that may not surprise the two of you is that the group that I actually took a look at in 1975 that were unhappy and a group that was a little more happy on campus had very different job search patterns.

Those who were out recruiting for a gazillion jobs all across the board with no focus were the unhappier people back when they were on campus, and in a fiftieth reunion, they’re the ones who’d gone through already four jobs in five years in a perpetual search, quest for happiness. The people who had a little bit sense of focus, it had nothing to do with how much income they had, by the way, there were Bain consultants that were unhappy, and Bain consultants who were very happy. There were Goldman Sachs bankers. They were happy and unhappy, but it had to do with something. Those of us who believe in adult development, I hate to suggest that there was anything that’s predetermined here, but something which does seem to matter is that if you recognize you’re a perpetually unhappy person in search of opportunities that never seem to be there, that maybe you need some perspective, some counseling, some friends, some kind of a support system to deal with it because people often have an opportunity to advance that they miss because they seem so desperately chasing the short-term break.

Howard Forman: Jeff, just in the last couple of minutes that we have, quick question, healthcare is a very big part of the pie for every business in terms of employee benefits, in terms of its impact on the health of workers and so on. And yet I think change is really slow. It’s sclerotic. We don’t see the type of dramatic change there as we do in the technology industry or in the manufacturing industry for that matter. What lessons have you learned or what ideas do you have that might jump-start change on the employer side that might help us move the needle in terms of both cost, quality, value for healthcare in America?

Jeffrey Sonnenfeld: Well, just in a nutshell, we’re 70 years into this problem, and people are still shellshocked as to how this is on the agenda of employers, is in the 1930s, this was not a responsibility of any employer except a few particularly paternalistic or utopian employers from an earlier century, literally. And FDR was considering, as you know, universal healthcare and decided to let it go, unfortunately, during the Depression. In the 1940s, then, this became a responsibility of employers. In 1942, there was a law that was passed that basically, as they were trying to put a cap on wage growth at the time, 1942, employee healthcare was exempted from any of those kind of tax considerations. In the year I was born, 1954, there was even a bigger change in the tax law that made it very attractive for employers to try to compete on healthcare.

But what a lot of CEOs won’t say to you publicly is they’re bedeviled as to, why healthcare? Why aren’t they responsible for employee housing? Why aren’t they responsible for employee nutrition and food? Why not employee education and the quality of communities and public safety and other areas where they would argue are just as important as their employees’ healthcare? How did this, what became an administrative duty, that evolved accidentally? You talk about serendipity—that was serendipitous. When we look at our trading partners in Europe, it’s almost every EU country has nationalized healthcare, as does Canada. But it varies. If you look at the Scandinavian countries, it is only 10% of people have private healthcare or so, it’s 50% though in other parts of the EU depending on income level what’s covered. In the U.S., we don’t have any of that. So the employers are confused when they look globally. In China, as, Howie, you know so much about it and I think you’ve done a lot to help them think through a template for how they approached it, where they had some degree of a tabula rasa. So that’s one issue is how do we get into this that CEOs are concerned about.

Another one is when you look at some innovation that’s been tried, like you remember when Amazon, JPMorgan, and Berkshire [Hathaway] tried of all things the Haven program, that blew up on them. And that’s the second problem that has to do with the entrenched interest for people or why WebMD never accomplished what it was supposed to do back 25 years ago, Healtheon, is because people saw there was an advantage to holding onto data slow. They didn’t want to facilitate faster payments. They liked the float. And the third problem is, and I chaired something with President Bush 41 and Dianne Feinstein, it was called National Dialogue on Cancer, we just, on that focused area, we found it hard to get... the CEOs weren’t the problem, but it was the National Cancer Institute, the American Cancer Society, the oncological nurses. We had the CDC, the FDA. Every group had their own... “We’re involved in prevention.” “No, we’re involved in research. So nobody ever has to worry about this and the future of basic research as the way to go.”

Others said we could cure most cancer right now, that the four major cancers are treated with proper diagnosis. It’s a quality issue of better treatment and equitable treatment is that people were battling often within a field. So when we looked at the Affordable Care Act, it was the then CEO of Pfizer who was the only person who really tried to pull everybody together. Jeff Kindler, who had other problems with his own boardroom, but he found he couldn’t even get the CEOs in the healthcare arena, the payers, the finance companies, the insurance companies, were completely different interest than the device makers, and of course the drug companies and the providers, the hospitals, he couldn’t get them to agree, let alone the rest of the business roundtable. He was just so frustrated. So the entrenched interest, it seems to be the biggest problem, and also the confusion as to how this became an employer responsibility and so many of our trading partners don’t have it. But that’s in a nutshell, it’s probably more of a ramble.

Howard Forman: I will tell you, I’m convinced that if you would bring them all into your leadership institute and have a conversation that you could move the needle, cause I think that you are the CEO whisperer, and I really—

Jeffrey Sonnenfeld: Only if the two of you are there, but thank you. Only if the two of you are there, because—

Howard Forman: Happy to be there.

Jeffrey Sonnenfeld: …you never are afraid to raise the undiscussable issues. I mean, I’m in all seriousness, you guys always raise the tough issues without ever being mean-spirited, but would be able to go around the room and realize you... I don’t know if you remember the old Pogo comic strip: “We have met the enemy and it is us.” It’s everybody in that room. It isn’t finger-pointing anybody... yeah.

Howard Forman: I agree. But look, Jeff, thank you very much for joining us in Health & Veritas. You are an incredible leader and an inspiring figure at Yale and beyond, so thank you.

Harlan Krumholz: No, no, thanks so much, Jeff. And you did introduce this idea that actually the fact that we don’t have a single payer is hurting our competitiveness in the world.

Jeffrey Sonnenfeld: Absolutely.

Harlan Krumholz: And I think that’s something that we should be talking about more, because maybe that can bring together some bipartisan support.

Jeffrey Sonnenfeld: Absolutely.

Harlan Krumholz: Wow, that was... We get Jeff going, and there’s a lot to learn and a lot going on. So let’s pivot, and he’s terrific. He’s just terrific. Let’s pivot to your part, Howie. What’s on your mind this week?

Howard Forman: Yeah, so there’s a huge acquisition, relatively huge at least, for CVS acquiring Oak Street Health, which is nominally a primary care provider based out of Chicago, but with a large footprint nationally. I think it’s a 10-billion-dollar acquisition. And it just reminds me at the same time, in the same week that Don Berwick has published an article that might as well have been entitled “Greed Is Bad in Healthcare,” it reminds me that healthcare is this massive industry. It goes back to what Jeff said, there’s all these entrenched stakeholders. It’s hard to make change.

And what do I see out there? I see companies like Amazon acquiring One Medical, which is basically concierge and high-level primary care for middle-class and richer individuals, and I see CVS acquiring practices that serve probably the most profitable segment of the insurance market, that being Medicare Advantage. This on the top of another release from government about the fact that Medicare Advantage has been overbilling government over the last 10 years. And it goes back to what you said earlier, Harlan, short of us moving to a single-payer system where some more nationalized system, we’re going to keep having profitable, entrenched interests dominating our healthcare delivery space rather than letting value and quality dominate the space.

Harlan Krumholz: So other people might say to you, Howie, that, “Hey, this is introducing competition in the system,” and there are people investing large amounts of capital to actually disrupt and redesign the way in which primary care works and the way in which the healthcare system is organized and that the legacy organizations have been sort of sitting pretty for a long time and have had little impetus to change. I often say little evolutionary pressure in healthcare, if you’re a big healthcare system sitting very happy within a healthcare market, and now these other companies are going to come in and say, “Hey, if people aren’t really satisfied with their current care with you, we’re going to give them other options.” Why wouldn’t that be a good thing?

Howard Forman: So if everything was equal, that would be a very good thing. What I’m concerned about is that most of the most profitable maneuvers that have happened in healthcare have not been among the sickest and the poorest and the most needy society, they’ve been basically a lot about financial engineering, figuring out how do you bill more for particular types of services? Why is Medicare Advantage so profitable? It’s very often because they’re able to code patients to a higher level of acuity and higher level of comorbidity so that they can extract more money from government.

Medicare Advantage from the moment that it was conceived in 2003 to today is the most profitable segment in the health insurance market. What’s the least profitable segment? The uninsured, the Medicaid population. No one’s really going after that population. All of these acquisitions that we see, all the commerce that is occurring is happening on the up end of the market. And what I worry about is they’re going to pick off the most profitable patients and they’re going to leave behind the people who need care the most. They’re going to be left behind. And I’m worried that that is just getting worse and worse, and that’s why we’re seeing our larger academic health centers, our larger hospitals are losing money right now because they’re not... they’re the ones who are providing care to these populations.

Harlan Krumholz: I think there is some innovation that’s occurring across the spectrum, and I did see that CVS also created a recent partnership with Rush University Medical Center. In Chicago, Rush is very committed to very disadvantaged areas within Chicago, unlike... it’s not on Michigan Avenue like Northwestern, it’s over in a different part of Chicago, and it’s serving large-scale populations that are in this same group you’re talking about that are disadvantaged. I’m going to be curious to see how that partnership works, whether that extends Rush.

Omar Lateef is the CEO there and does a terrific job, and I’m sure he’ll make sure that that initiative is focusing on health equity as well. But yeah, I mean, this is very interesting. Look, we’ve got big players, technology firms have got deep pockets. Their history, though, is when people go beyond their core expertise, they get into trouble. So the Googles and Amazons and others, when they have gone into healthcare, we’ll see. Amazon’s in deep now. CVS of course is a healthcare company, and it’s trying to expand. It’s gone all the way from, like you said, insure, bricks and mortar, to also I believe it’s going to be developing means by which there’ll be some remote also.

Howard Forman: Well, remember Rubicon, and we interviewed Gil Addo just a few weeks ago. Rubicon is a subsidiary of Oak Street, so...

Harlan Krumholz: Oh, right. That’s right.

Howard Forman: So they’ve acquired Rubicon, which is the subspecialty telemedicine piece. I’m not against the innovation that’s going on. I’m worried that the money is flowing to the areas that are most profitable, and we have an enormous part of the market that will never be profitable the way we’ve structured healthcare in this country.

Harlan Krumholz: Well, and I totally agree with you. I mean, why is it that certain parts of healthcare have such greater margins than others, by the way? Why do we pay so differentially within healthcare? And I think people are naturally going in and saying, “We can unbundle the service,” is what they’ll say. “We can disintermediate other people and take what’s highly profitable.” I totally agree with you. And then what’s left? So it’s a potential issue, but I think we can watch it with interest. There is a potential for good too. So we need to be alert to that.

Howard Forman: I think you and I need to have this conversation regularly, because I’m becoming more disenchanted. At least you give me a little bit of hope there. But I worry a lot about the direction we’re going in right now.

Harlan Krumholz: Yeah, well, people are going to have to sign up. If they lose the customers, they don’t provide the services, then they’ll have a problem. So at least they’re going to have to keep people happy. Great. You’ve been listening to Health & Veritas with Harlan Krumholz and Howie Forman.

Howard Forman: So how did we do? To give us your feedback or to keep the conversation going, you can find us on Twitter.

Harlan Krumholz: I’m @hmkyale, that’s H-M-K Yale.

Howard Forman: And I’m @TheHowie. That’s @T-H-E-H-O-W-I-E. You can also email us at health.veritas@yale.edu. Aside from Twitter and our podcast, I’m fortunate to be the faculty director of the healthcare track and founder of the MBA for Executives program at the Yale School of Management. Feel free to reach out via email for more information on our innovative programs or you can check out our website at som.yale.edu/emba.

Harlan Krumholz: And Howie, I want to take a moment just to express appreciation to our listeners. Our listening base is growing, and we’re excited about that. And again, anyone wants to reach out to us, please do.

Howard Forman: And by the way, rate us. Rate us on Apple or Google or whatever your favorite platform is. Rate us. It helps people find us, and that would be a great thing for expanding our base, but we really do appreciate you all.

Harlan Krumholz: Yeah, that’s a good idea, Howie. Health & Veritas is produced with the Yale School of Management. Thanks to our researcher, Jenny Tan, to our producer, Miranda Shafer, they are absolutely amazing. Talk to you soon, Howie.

Howard Forman: And in acknowledgment of Jeff Sonnenfeld, the son of Philadelphia, go Eagles.

Harlan Krumholz: Oh my goodness. You’re partisan.

Howard Forman: Thanks, Harlan. Talk to you soon.